Hungary Insurance Report Q4 2012
Business Monitor International, September 2012, Pages: 82
The Hungary Insurance Report provides industry professionals and strategists, corporate analysts, insurance associations, government departments and regulatory bodies with independent forecasts and competitive intelligence on Hungary's insurance industry.
The Hungary Insurance Report considers the prospects for both life and non-life insurers in that country.
Relative to its peers in Central and Eastern Europe, Hungary stands out for several reasons. The most obvious is that it has been shrinking, by at least one metric, for years. The latest data, published by the Association of Hungarian Insurance Companies (MABISZ) in Q112, indicate that, in terms of gross premiums written, both segments were smaller in 2011 than they had been in 2007. Although the life segment is dominated by unit-linked products, a characteristic that attests to the risk tolerance of Hungarian households who use life insurance and one that also sets Hungary’s insurance sector apart from others in the region, the volatility of financial markets has taken its toll. Brutal competition in motor related lines (ie: both compulsory motorists third-party liability – CMTPL – cover and voluntary hull insurance or CASCO) has forced tariffs downwards: this is a challenge that has been highlighted by many of the insurers that have commented on business conditions in Hungary over the last year.
Hungary’s is, of course, not the only non-life segment in Central and Eastern Europe in which there has been, or remains, competition in motor-related lines. However, BMI remains of the view that the competition has been exacerbated by the fragmentation of the market. In spite of the lack of growth and the small size of the Hungarian non-life market, by most metrics, all of the multi-national companies that have a commitment to the region are present. Unlike in the Czech Republic, Slovakia and Poland (but in a similar way to Serbia, Croatia and Slovenia) small indigenous companies, collectively, command a significant market share. The life segment, too, is relatively fragmented. In the last year or so, though, the pressures on the non-life companies have moderated as a result of reductions in combined ratios: as has been the case in most of the other markets in the region, the insurers were spared the massive (mainly)
flood-related losses that blighted 2010.
At a time that many of the market metrics are moving in the wrong direction, some multi-national groups may come to see Hungary as a market in which they no longer need a presence. We would be amazed if there is not substantial consolidation over the coming three years or so.
Executive Summary 5
Table: Total Premiums, 2009-2016 5
Key Insights And Key Risks 5
SWOT Analysis 7
Hungary Insurance Industry SWOT 7
Hungary Political SWOT 8
Hungary Economic SWOT 9
Hungary Business Environment SWOT 10
Life Sector 11
Central And Eastern Europe Life Sector Overview 11
Table: Central And Eastern Europe Life Premiums, 2009-2016 11
Hungary Life Sector Update 14
Life Industry Forecast Scenario 15
Table: Hungary’s Life Premiums, 2009-2016 15
Growth Drivers And Risk Management Projections 15
Population 15
Table: Insurance Sector Key Drivers – Demographics, 2009-2016 16
Non-Life Sector 18
Central And Eastern Europe Non-Life Sector Overview 18
Table: Central And Eastern Europe Non-Life Premiums, 2009-2016 18
Hungary Non-Life Sector Update 20
Non-Life Industry Forecast Scenario 21
Table: Hungary’s Non-Life Premiums, 2009-2016 21
Growth Drivers And Risk Management Projections 22
Macroeconomic Outlook 22
Table: Hungary Economic Activity, 2011-2016 25
Political Stability Outlook 25
Table: Europe Security Risk Ratings 27
Epidemiology 28
Table: Insurance Key Drivers – Disability-Adjusted Life Years, 2009-2016 29
Motor 30
Insurance Risk/Reward Ratings 32
Table: Hungary’s Insurance Risk/Reward Ratings 32
Table: Central And Eastern Europe Insurance Risk/Reward Ratings 33
Competitive Landscape 34
Competitive Landscape Analysis 34
Major Players In Hungary’s Insurance Sector 35
Company Profiles 37
AEGON 37
Allianz 40
AXA 43
BNP Paribas Cardif 46
Hungary Insurance Report Q4 2012
© Business Monitor International Ltd
Page 4
ERGO 49
Generali PPF Holding 52
Groupama 58
MetLife 61
QBE Insurance Group 64
UNIQA Group 67
Vienna Insurance Group 70
Demographic Outlook 74
Table: Population By Age Group, 1990-2020 (‘000) 75
Table: Population By Age Group, 1990-2020 (% of total) 76
Table: Key Population Ratios, 1990-2020 77
Table: Rural And Urban Population, 1990-2020 77
BMI Methodology 78
Insurance Risk/Reward Ratings 79
Table: Insurance Business Environment Indicators And Rationale 80
Table: Weighting Of Indicators 81
KÖBE (Transport Insurance Association) , Posta Biztosító (Hungarian Post Insurance/Life) , , AEGON , Allianz , Aviva , AXA , BNP Paribas Cardif , ERGO , Achmea , Generali , GRAWE , Groupama , HDIGerling/Talanx , ING , KBC Group , MetLife ALICO , Prudential Financial , QBE , RSA , UNIQA , Vienna Insurance Group , Zurich ,
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